Title: OM Diary

DATE:03/10/2018
PGDM No: 18131
Name: Bharath Kumar B Y
Section C
About The course:

Discussed the course outline, structure of the course, course evaluation pattern, why we
are studying OM, discussed pedagogy of the course, evaluation criteria, group assignments,
rubrics, case study and Class diary.

Operations Management:

 OM is defined as the design, operation and improvements of the systems that create and
deliver the products and services resulting in value addition.
 It is also defined as the set of activities that value in the form of goods and services by
transforming inputs into outputs.
 It is the business function responsible for managing the process of creation of goods
and services.
 It is the central core function of every company regardless of the size of the company,
the industry it is in whether it is manufacturing or service or it is for profit or not for
profit.
 Operations is present everywhere.
 Operations has direct relationship with Finance, Suppliers, Marketing, HR etc.

Examples for Operations Management:

1. In the Airline Industry

 Operations is used for flight operations, catering, ground support, facility
maintenance, loading baggage’s etc.
2. Funeral services
 It helps in managing all the activities of funeral like how many people are
required to gather, what to do if rain comes, how to perform all functions etc.
3. United Parcel Service (UPS), an international package delivery service, formed a
partnership with its customer,.

[Link]
management/

Production:

 It is the creation of goods and services.

 Ex: Manufacturing, design, service etc.

Production System:

 It is defined as the use of resources to transform inputs into some desired outputs.
  Ex: 1. Internal Combustion Engine: Here The fuel enters the engine and is converted
into energy and after that energy is used in movement of the vehicle when one presses
the accelerator.
2. Sugar Industry- Here, sugarcane is first used as an input, then the juice of sugarcane
is processed through a conversion process, finally to get an output known as a refined
sugar (used for mass consumption).

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Inputs Transformation Output

Process s

Feasibility
Constraints

Feedback and
Control

Feasibility constraints:
 We would not be knowing how the system works.
 Constraints for production.

Environment

INPUTS:
Material OUTPUTS
Labour Goods
Transformation System
Energy
Services
Money
Unintented
Knowledge
Equipment

Stakeholders
Environment: Includes the working environment where production is taking place.
Stakeholders: Includes everyone who is directly or indirectly involved in production. They
are affected by both inputs and outputs.
Unintended/Undesirable: These would be the by products of a product. They would
produce waste, pollution, Noise, Smell.
Ex: [Link] bags which are the unwanted products left after tea production.
[Link] yielded during the desalination of water.
3. Buttermilk in the manufacture of butter
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Goods V/S Services:
Goods:
 Can be resold.
 Can be Inventoried.
 Some aspects of quality are measurable
 Selling is distinct from production
 Product is transportable
 Easy to automate
 Revenue generated primarily from tangible products
Services:
 Reselling unusual
 Difficult to inventory and automate
 It is difficult to measure quality
 Cannot stock
 Provider, not product is transportable.
 Revenue generated primarily from intangible products
Performance Measures:
The performance is measured based on the following constraints,
 Cost: How much does it cost?
 Speed: How fast?
 Efficiency: How efficiently it performs operations
 Standards: Does it meet all the standards
 Flexibility: Is it flexible enough to adapt to changes
 Productivity
 Quality
Concerns of Operation Management:
 Competition
 New technologies
 Increased Outsourcing
 Shortage of inputs.
  Environment
By understanding all the concerns of Operations Management, one would think is “How to
Manage” all the tasks efficiently and effectively.
Questions and Answers:
1. Briefly describe the term Production/Operations Management.

 Production is the creation of goods and services.

 OM- It is defined as the set of activities that value in the form of goods and services by
transforming inputs into outputs.
2. List five important differences between manufacturing and service operations.

 Manufacturing
Some aspects of quality are measurable
Selling is distinct from production
Product is transportable
Easy to automate
Revenue generated primarily from tangible products
 Services
It is difficult to measure quality
Cannot stock
Provider, not product is transportable.
Difficult to automate
Revenue generated primarily from intangible products
3. Why are services important? Why is manufacturing important?
 Services pervade the business world. Service processes tend to produce intangible,
perishable outputs. Here customers may take an active role in the process itself.
 Without manufacturing processes the products we enjoy as a part of our daily lives
would not exist. Manufacturing gives rise to service opportunities. Manufacturing
converts materials into goods that have a physical form called as products.
[Link] the operations function and the nature of the operation manager’s job.
 Operations serve as an excellent career path to upper management positions in many
organizations. Because operations managers are responsible for key decisions that
affects the success of the organization. Operation function is a function were the
products are manufactured and services are rendered to the customers.
5. Identify the three major functional areas of business organizations and briefly
describe how they interrelate.
 The three major functional areas of business organizations are: Operations, Marketing
and Finance. Each area is unique and has its own knowledge and skill areas, primary
responsibilities, processes and decision domains. Finance generate resources, capital,
and funds from investors and sales of its goods and services in the marketplace. Based
on the business strategy finance and operations functions decide how to invest these
resources and convert them into physical assets and material inputs. Marketing is
responsible for producing sales revenue of the outputs, which become returns to
 investors and capital for supporting operations. These relationships provide direction
for the business as a whole.
6. Identify some current trends in operations management and relate them to recent
news items or personal experience.
 Internal communication, Mobile accessibility, Automization, Performance
measurement, Outsourcing and Employee analytics. Beyond sales figures-based
analytics, employee feedback and surveys can also contribute to better business overall.
On the face of it, operations management may appear to span only materials and
products, but people are an essential component of any business structure
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Questions from 5th Edition, Production/Operations Management by William J Stevenson.
Example of an Indian Company: Reliance Dairy Foods Ltd
In 2009, Reliance Dairy Foods Ltd (Reliance Dairy), a subsidiary of Reliance Retail,
entered the country’s branded milk product market. It introduced a range of dairy products
including milk, curd, butter, and flavored milk. Reliance Dairy had 75,000 to 80,000 liters of
milk sale per day, out of which 10 percent was sold through the Reliance Dairy stores and 90%
through its distributors. The price of Reliance Dairy was only Rs 28/- per liter which according
to some analysts seemed to be value for money.
The company claimed that strict hygiene was maintained in production and that its milk
was of the best quality. Also, the product was considered to be free from chemicals and
preservatives and adhered to the best packaging technology. The milk variants were also
modified as per the geographical requirement of customers. The company tried to capture the
market by following a strong supply chain and branding strategy. However, sustaining itself in
the dairy business was difficult as the market was highly competitive and flooded with several
brands such as Amul, Mother Dairy, and Nestlé. In April 2017, Reliance Diary was acquired
by Hyderabad-based dairy company Heritage Foods Limited (Heritage). Heritage planned to
achieve breakeven in Reliance’s dairy business by closing down milk procurement on loss
making routes and shifting the processing and packaging of milk from third party facilities to
Heritage’s own facilities.
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Feedback about class:
The class was interesting and new for me. I got the introduction about the operations
which are taking place in the industries. I came to know how value is delivered to the
customers. The examples were real, and it made very easy to understand the topics. The
diagrams made the task easier to understand the topics. This course taught that no department
can work without operations. The Mercedes Video in the beginning tempted many to have it
in the near future.